27, December 2017

‘SAATHI’ (Sustainable and Accelerated Adoption of Efficient Textiles Technology to Help Small Scale Industries) was launched jointly by Ministry of Textiles and Ministry of Power to provide energy-efficient powerlooms, motors and rapier kits to small and medium powerloom units at no upfront cost.

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USTTAD (Upgradation of Skills and Training in Ancestral Arts/Crafts for Development) project initiated in collaboration with Ministry of Minority Affairs will encompass 25 handicraft and handloom clusters.

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Hastkala Sahyog Shivirs to benefit over 1.2 lakh weavers

The textiles ministry will organise ‘Hastkala Sahyog Shivirs’ in 421 handloom-handicrafts clusters across the country which will benefit over 1.2 lakh weavers and artisans.

Services like issuance of credit facilities through MUDRA scheme, assistance for technological upgradation under Hathkargha Samvardhan Sahayata, distribution of modern tool- kits and equipments and buyer-seller meets and expos will be provided to the weavers and artisans in these camps.

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Blue Flag for Beach Clean-up

The environment ministry has launched a pilot project named ‘Blue Flag’ for beach clean-up and development.

The prime objective of the project is to enhance standards of cleanliness, upkeep and basic amenities at beaches. Under the project, each state or union territory has been asked to nominate a beach which will be funded through the ongoing Integrated Coastal Management Programme.

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RASAD scheme:

PRASAD scheme aims to create spiritual centres for tourism development within the nation. To implement the PRASAD scheme a Mission Directorate has been set up in the Ministry of Tourism.

“Two types of bins will be placed at the ghats. While the green ones are for biodegradable garbage, the yellows will be for non-biodegradable materials,”

The triangular Sagar Island, situated around 130 km from Kolkata, is separated from the mainland by rivers Ganga and Muriganga on two sides and faces the Bay of Bengal on the third side.

Lakhs of Hindu pilgrims gather here every year during Makar Sankranti to take a holy dip at the confluence of the Ganga and Bay of Bengal.

Muri Ganga River (also called Baratala River or Channel Creek) is a distributary of the Hooghly in South 24 Parganas district in the Indian state of West Bengal.

Before joining the Bay of Bengal, the Hooghly bifurcates with one channel passing east of Sagar Island. This channel is called the Baratala River or Channel Creek. It is locally known as Muri Ganga

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2.China opens door for Afghanistan’s participation in CPEC

Source: The Hindu

China flagged the possible inclusion of Afghanistan in the China Pakistan Economic Corridor (CPEC) — a move that is likely to irk India.

India has opposed CPEC, which passes through Pakistan occupied Kashmir (PoK), on grounds that it infringes its sovereignty.

Key facts:

China has called CPEC a “flagship project” of its Belt and Road Initiative (BRI), aimed at building connectivity along the Eurasian corridor.

A joint statement released at the end of the one day conference said that the three countries reaffirmed their commitment towards “advancing connectivity under the Belt and Road Initiative”.

Analysts say that the proposal for landlocked Afghanistan’s, access to the port of Gwadar — the starting point of CPEC — may be intended to balance if not undermine the trilateral agreement among India, Iran and Afghanistan, which gives Kabul access to the Iranian port of Chabahar.

China – Afghanistan:

Pakistan and Afghanistan agreed that they are building up a new mechanism of crisis management, including information sharing and intelligence cooperation. China supports these kind of bilateral efforts.

The joint statement listed establishing “political mutual trust and reconciliation, development cooperation and connectivity, security cooperation and counter-terrorism as three topics of the trilateral cooperation”.

It signaled that considerable work was still required to concretise cooperation in the arena of counterterrorism and economy. The three foreign ministers agreed to “communicate and consult” on defining a Memorandum of Understanding on Counter-terrorism.

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3.Finance Ministry to issue recapitalisation bonds to PSBs

Source: The Hindu

The Ministry of Finance is likely to issue the first tranche of recapitalisation bonds to public sector banks (PSB) in early January. The recapitalisation bonds will not be sold in open market and will be issued to all banks. Apart from this, the government will also infuse capital worth Rs 8,000 crore on the basis of performance.

Earlier in October, the government had announced an unprecedented PSU banks recapitalisation programme of Rs 2.11 lakh crore.

This was essential to improve the lending capacity of the banks and to increase public spending on infrastructure.

Nature of re-cap bond:

The government will issue bonds worth Rs 1.35 lakh crore to PSBs against equity shares. This then becomes a cash-neutral transaction (instead of a direct cash infusion). The government can also float a bank holding company, transfer all its shares in PSBs to this corporate entity, infuse some capital into this entity.

This entity then borrows in the market against its equity as a AAA Quasi-Sovereign entity and uses the money to recapitalise the banks.

Fiscal implication:

Since upfront it’s a cash neutral transaction, fiscal deficit will be impacted only by the interest cost on the bonds that the government pays every year.

The government’s overall debt/GDP ratio though will increase to the extent of the bond issued and so will its repayment obligations. Whenever the banks require liquidity, they can sell these bonds in the market, raise cash and use it for either lending or write-off purposes.

Significance of this move:

Ultimately, this recapitalisation will lead to an improvement in the government’s finances as it would also be able to sell its stake in public sector banks at much higher valuations.

Even on the demand side, some banks who were not investing their extra cash into debt securities due to capital shortage may now be able to do so instead of placing them with the Reserve Bank of India’s reverse repos.

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